U.S.-PRC tensions upend tech funding supply chain 4 Jun 2019 American venture capitalists pumped a record $19 bln into Chinese startups in 2018 while flows the other way reached a high of $3.6 bln. Tougher foreign-investment rules and rising nationalism are set to add friction to capital movement, creating new winners and losers.
Google and Amazon are the antitrust appetizer 3 Jun 2019 U.S. regulators may be divvying up oversight of the tech giants, paving the way for potential investigations. Facebook ought to worry too. The social network creates less overt competition risk, but the experience of vetting Google and Amazon could guide tougher fights.
U.S. food-delivery rivals risk capital destruction 30 May 2019 Using the internet to turn people’s laziness and hunger into a business sounds like a sure win for Silicon Valley. Uber, Grubhub, DoorDash and others are feasting on meal-delivery cravings. But sector valuations may overstate the market opportunity, at least in the United States.
Huawei’s EU friends will stay on the line for now 30 May 2019 BT and Vodafone paused sales of some of the Chinese group’s phones after America put it on a blacklist. Yet Huawei equipment still pervades European telecom networks. Ripping it out now would be costly and disruptive. Better to wait and see whether the U.S. pressure persists.
Uber and Lyft create Asian valuation conundrum 30 May 2019 U.S. ride-hailing exuberance faded into lacklustre market debuts. At the same time, Singapore’s $14 bln Grab, for example, recently raised capital privately at 7 times expected revenue, compared to Uber’s 5 times. Fast-growing payment units can only justify some of the gap.
U.S. watchdog should throw down Facebook gauntlet 29 May 2019 The FTC is working with the social network on a settlement for failing to protect user data, including a mooted fine of up to $5 bln. A lawsuit against Mark Zuckerberg’s firm might be a better option. It’s risky, but it could grab Facebook’s attention and change its behavior.
Hadas: Facebook could fall into a new-money trap 29 May 2019 The social network could muscle into the fast-growing but competitive payments business. But founder Mark Zuckerberg appears to want to start a new currency. That’s crazy. A company with data-control issues is more likely to fall apart than break the government-bank money nexus.
Payments bonanza has spoils even for latecomers 28 May 2019 Global Payments’ $22 bln merger with Total System Services is the sector’s third big deal this year. What it lacks in first-mover advantage it makes up for with sensible terms – the premium is less than FIS is giving Worldpay. Missing consolidation would have been a worse fate.
Alibaba’s cracks show by revisiting Hong Kong 28 May 2019 The $400 bln e-commerce company plans to raise up to $20 bln from a second listing, five years after its New York IPO. Investors closer to home may give Alibaba a richer valuation. But seeking fresh capital alongside younger rivals also suggests its dominance is under threat.
Hollywood superagents demand investor tolerance 24 May 2019 Endeavor, the owner of William Morris, IMG and UFC mixed martial arts, is going public with a complex structure. In a town built on relationships there are benefits to keeping those with the best contacts close. But governance and an industry in flux confuse the IPO script.
Isolated Huawei may be shoved into Beijing’s arms 24 May 2019 Important suppliers such as Arm and Intel are abandoning the Chinese telecom titan after the United States blacklisted it. That puts $50 bln in overseas revenue at risk. Huawei has cash to cope for now, but a breakup or state intrusion can’t be dismissed as potential endgames.
Tech firms can be citizens as well as piggy banks 23 May 2019 San Francisco is mulling a so-called IPO tax to help fund affordable housing. Money isn’t really the issue, though: useful projects get snared in local opposition. Facebook and its ilk would do more good getting staff to be engaged citizens, and even incentivizing them to do so.
Viewsroom: America’s topsy-turvy regulators 23 May 2019 Qualcomm lost a lawsuit brought by one DC overseer, even as the DOJ intervened, while $26 bln T-Mobile US-Sprint merger is getting yanked around by agencies with opposing views. Doing business is hard when agencies no longer act in unison. Plus: Is Luckin Coffee going cold?
Meituan Dianping delivers sweet-and-sour to Uber 23 May 2019 Getting bigger enabled the $40 bln Chinese company to cut its operating loss by charging restaurants for ads and fees to tote meals. Intensifying competition with Alibaba, however, will eat into cash. Uber can expect similar trouble as it squares off with Amazon-backed Deliveroo.
TransferWise valuation relies on heroic growth 23 May 2019 The UK-based money transfer startup’s latest fundraising values it at $3.5 bln. Justifying the price tag implies the volume of foreign exchange it handles has to grow roughly fourfold to 200 bln pounds by 2023. It’s a huge market, but competition from banks will only intensify.
Canada adds startup-like optimism to tech turf war 22 May 2019 The country has simpler immigration, livable cities and lower valuations than its southern neighbor. Capitalizing on U.S. dysfunction in a bid to become a tech magnet is smart. But if Silicon Valley is any guide Prime Minister Justin Trudeau should be careful what he wishes for.
Qualcomm, Sprint show U.S. policy blowing in wind 22 May 2019 A judge ruled against the $94 bln chipmaker in an Obama-era case the current administration failed to stop. The DOJ may block the FCC-recommended $26 bln telecom merger with T-Mobile US. Such cases highlight the random nature of Trump-era oversight. That’s bad for business.
Hadas: “Zero privacy” is both blessing and curse 22 May 2019 Back in 1999 a computer executive told people worried about disclosing personal data to “get over it”. They mostly have. Shared information is now too useful for regulation to restore lost innocence. For oppressive governments, meanwhile, individualised media is also valuable.
Google’s hidden costs give Beijing sticker shock 22 May 2019 Reaching for sharper trade weapons, Washington has clamped down on Huawei's access to the U.S. giant's software. Chinese handset makers selling abroad rely on Google tech: the free Android system powers their phones. A crackdown leaves much of a $175 bln export market vulnerable.
Big Tech deserves Wall Street-like global cop 21 May 2019 The G20 helped rein in systemically risky banks after the financial crisis by creating the Financial Stability Board to develop new rules. Adapting that approach to set up an Internet Accountability Board would be a smart way to police the likes of Facebook, YouTube and Twitter.